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Analysts at ING suggest that the key Japanese event in the week ahead will be the all-important October BoJ meeting (Wed).

Key Quotes

“Our economists note that BoJ Governor, Haruhiko Kuroda, has been dropping hints about changes to BoJ policy.”

“Kuroda has been sounding more positive about inflation, with core (ex-fresh food) inflation now at 1.0%. The elusive 2% level may still be the official target, but there is a sense that a more pragmatic ‘good enough’ rate of about 1% could pave the way for the BoJ to start tweaking its policy stance.”

“We think that we may see more stealth tightening steps to come this week – and this could be mildly supportive for the yen.”

“With global markets still looking fairly fragile, the combination of a hawkish BoJ and sell-off in risky assets could be quite supportive for the yen. While USD/JPY could drift lower here towards 111.00-111.50.”